Friday, June 22, 2007

Premium Pricing.

Having started the week at a London Business School seminar about low-cost competition, I end it at the latest Damien Hirst exhibition that includes the much hyped skull supposedly encrusted with £12 million worth of diamonds and open to viewing amidst much "security rigmarole".

I don't know what £12 million worth of diamonds looks like, but the skull was far from the most exciting piece in the show and perhaps that's the point. Diamonds, after all, are artificially priced in a skewed market. And wouldn't it be even more interesting if these weren't in fact diamonds?

If you compete on price alone, you're saying that your offering has nothing for your customers to care about save its cheapness. But if you make it, in some sense, special, then you can charge a premium which people will pay for any number of reasons icluding, but not limited to, ostentation, convenience, vanity and paranoia.

Interested to know if you're in the UK and thus able to see this skull since you clearly know diamonds. I remarked at the time that these didn't seem to have the lustre of others I've seen (such as in the crown jewels) but that may have been due to the setting and the lighting.

Having not liked his previous shows in London and New York, I did however enjoy the rest of this one.